The Cabilly patent family (including Cabilly I, II and III) is likely the most famous patent family in biotechnology. With claims that cover basic steps in generating therapeutic antibodies, these patents are gatekeepers in an industry that has shown unprecedented growth—currently, half of the 10 top-selling drugs in the world by sales are therapeutic antibodies. Through licensing to antibody manufacturers, Genentech—one of the owners of the Cabilly patents—is expected to reach a billion dollars in royalties from this patent family by 2018.

Not surprisingly, the Cabilly patents have been extensively challenged, through interference proceedings, reexamination, and multiple rounds of litigation, as far as the Supreme Court. These patents seemed untouchable, withstanding all of these challenges. Now, the “Cabilly II” patent (US Patent No. 6,331,415) faces a new and potentially more potent threat. Sanofi-Aventis U.S. LLC and Regeneron Pharmaceuticals, Inc. filed an IPR petition last July (IPR2015-01624), challenging most of the claims of Cabilly II as allegedly anticipated and obvious. On February 5th, 2016, the PTAB instituted this IPR proceeding, finding that the petitioners had demonstrated a reasonable likelihood of prevailing on obviousness grounds regarding almost all of the challenged claims.

The PTAB was not persuaded by the patent owner’s arguments that the same issues and theories of unpatentability had already been addressed at length in earlier USPTO proceedings, noting that the petitioners’ primary reference, which had not been considered by the USPTO, was “more specific” than the primary reference the USPTO focused upon. Significantly, nor was the PTAB persuaded by the evidence of extensive licensing of Cabilly II—70 licenses granted between 1991 and 2013—set forth by the patent owner. Indeed, the PTAB did not even mention secondary considerations in the Decision on Institution, consistent with a trend in post-grant proceedings of minimizing the relevance of secondary considerations in obviousness analysis. (Our post-grant group has one of the rare wins for patent owners based on secondary considerations.)

While the outcome of this case is still unknown, the statistics do not bode well for patent owners following institution of IPR proceedings. As of December 31, 2015, out of 1,204 trials instituted, only 96 resulted in all instituted claims being upheld (corresponding to 8% of proceedings that were instituted). Moreover, two additional IPR petitions have recently been filed also challenging Cabilly II (Genzyme Corporation v. Genentech, Inc. and City of HopeIPR2016-00383 and Genzyme Corporation v. Genentech, Inc. and City of HopeIPR2016-00460), which are currently pending.

The specifics of the Cabilly IPR story will be watched with great interest by the biotech community. More generally, it will also be viewed as an example of the potential power of IPR to threaten a patent that has so far seemed untouchable.